Taxation of Non-Residents in Romania: Tax Obligations

Published on May 3, 2026 and written by Cyril Jarnias

Navigating the tax maze in Romania can be complex for non-residents, who must fulfill their reporting obligations while complying with local legislation.

This article delves into the specifics of taxation applicable to non-residents, focusing on the essential steps to avoid administrative pitfalls.

The main challenges include understanding taxable income, determining tax residency status, and complying with European rules.

Attracting many foreign investors, Romania offers a relatively competitive tax framework, but non-residents must remain vigilant against potential pitfalls to fully capitalize on the economic opportunities available.

Taxation of Non-Resident Expatriates in Romania

The main types of income subject to taxation for non-resident expatriates in Romania, when derived from Romanian sources, include:

• Salaries paid by a Romanian employer
• Interest generated from accounts or investments in Romania
• Dividends distributed by Romanian companies
• Rental income from leasing a property located in Romania
• Independent activities or services performed locally

Type of Income	Tax Rate	Observations
Salaries	10%	Annual return required
Interest	10%	Withholding tax possible
Dividends	8% – 5%	Depending on type and context
Rental income	10%	On the net amount received
Unidentified source	16%	Special case

Exceptions and exemptions may apply depending on the exact nature of the income or the taxpayer’s status.

Double taxation treaties concluded between Romania and various countries (France, Germany, etc.) generally allow:

• A reduced tax rate on certain income (dividends, interest)
• A tax credit in the country of tax residence for tax paid in Romania
• Exemption in one of the two countries according to treaty provisions

Example: For a French tax resident receiving Romanian dividends, a reduced withholding tax may apply under the Franco-Romanian treaty.

Specific Reporting Obligations for Non-Residents

• Filing an annual return concerning locally generated income
• Payment of the tax due within a set deadline (often before the end of May following the tax year)
• Possible submission of supporting documents to the Romanian tax authorities if requested

Payment is generally made via bank transfer to the Public Treasury. In the case of withholding tax (dividend or interest), no further action is required unless specifically requested.

Possible Tax Relief and Exemptions

• Direct application of bilateral treaties: partial reduction/exemption
• Exemption on certain small amounts or specific categories (micro-enterprises, etc.)

Distinction Between Tax Residency and Non-Residency Under Romanian Law

Tax Status	Main Criteria	Taxable Scope
Tax Resident	Main domicile in Romania + stay >183 days/year	Worldwide income taxable
Non-Tax Resident	No domicile or prolonged stay	Only local income

An expatriate is considered a non-tax resident as long as they do not reside for more than six consecutive months nor transfer their center of economic interests to Romania. Only their income directly derived from the territory is then subject to local tax rules.

For each specific situation, non-resident expatriates are advised to consult a certified accountant to optimize their return and tax burden.

Reporting Obligations for Non-Residents

Specific Tax Obligations for Non-Residents in Romania

Non-residents in Romania are taxed only on income from Romanian sources. The main reporting obligations, forms to use, deadlines, and exceptions are detailed below.

Taxable Income for Non-Residents

• Interest, royalties, and commissions received from Romanian residents.
• Income related to sports or entertainment activities carried out in Romania.
• Management or consulting fees if the service is paid for by a Romanian resident.
• Income from independent activities performed in Romania (under certain conditions).
• Gains from the liquidation of Romanian companies.
• Prizes from competitions organized in Romania.

Tax Rates

Flat rate of 10% for non-residents who are nationals of an EU member state or a country with a tax treaty with Romania.

Reduced rate or possible exemption depending on the applicable tax treaty.

Returns and Forms to Submit

Situation	Main Form to File	Filing Deadlines	Observations
Determining tax residency upon arrival	“Set of questions to determine the individual’s tax residency upon arrival in Romania”	Upon arrival or upon request	Mandatory except for exceptions (diplomats, etc.)
Departure from Romania after obtaining residency	“Set of questions to determine the individual’s tax residency upon departure from Romania”	Before departure
Income from Romanian sources (excluding employees)	Specific income tax return (ANAF form)	Generally, before May 25 of the year following the income year	Subject to withholding tax for certain income

Exceptions and Exemptions

Diplomats, agents of international organizations, certain foreign officials, and their families are exempt from the tax residency declaration upon arrival.

Exemptions or reduced rates possible under international tax treaties.

Penalties for Non-Compliance

Administrative fines for late filing or failure to file mandatory forms.

Late payment interest and penalties for non-payment or late payment of tax.

Risk of tax investigation and reassessment in case of false declaration.

Correction Procedures

If a return proves to be erroneous, the non-resident can file an amended return with ANAF (National Agency for Fiscal Administration).

A new form or additional documents may be required. The administration then issues a notification correcting the taxpayer’s tax situation.

Concrete Examples

Situation	Reporting Obligation	Specifics / Consequences
A French consultant invoices a Romanian company	Income return, taxation at 10% (withholding tax)	May obtain an exemption if the France-Romania treaty applies, upon presentation of a residency certificate
A non-resident athlete wins a prize at a tournament in Romania	Return and taxation at 10%	Withholding tax by the tournament organizer
A US diplomat posted in Bucharest	Exempt from the tax residency declaration	No taxation on foreign or diplomatic source income

Key Points to Remember

• Non-residents must ensure they file the required forms upon their arrival or departure, depending on their situation.
• It is essential to check for a tax treaty between Romania and the country of residence to avoid double taxation or benefit from exemptions.
• Failure to comply with obligations can result in financial penalties and administrative complications.
• Correcting declarative errors is possible via amended returns but must be done promptly to limit penalties.

Important: Obligations vary depending on the nature of the income, length of stay, and the existence of international agreements. Tax guidance is recommended for complex situations.

Avoiding Double Taxation in Romania

Romania has signed over 80 bilateral tax treaties to avoid double taxation. These agreements, based on the OECD and UN models, aim to allocate the right to tax income between Romania and its partners and to prevent tax evasion.

Type of Income	Maximum Rate Provided (Example Romania-France)
Dividends	5% to 15%
Interest	0% to 10%
Royalties	generally capped between 0% and 10%

Essential Principles of the Treaties:

• Non-discrimination between nationals of the signatory states.
• Reciprocity of tax benefits.
• Limitation of the right to tax certain income by the source state.
• Prevention of tax evasion through information exchange.

Covered income includes salaries, dividends, bank interest, intellectual/commercial royalties…

Main Mechanisms to Avoid Double Taxation:

• Tax credit (direct imputation): Tax paid in the source country is deducted from the tax due in the country of residence.
• Total or partial exemption: Certain income is exempt from taxation in one country based on its nature or origin.
• Alternative method depending on the income category.

Summary List of Practical Effects:

• Reduction of the overall tax cost thanks to treaty caps
• Increased legal certainty for investors/expatriates
• Simplified reporting

Documentary Obligations for Non-Residents Wishing to Benefit from Treaties:

To apply these favorable measures in Romania:

• Provide official proof of foreign tax residency (tax certificate issued by the partner country’s administration).
• Accurately declare all income received in Romania during the annual tax filing.
• Complete any specific documentation required by the Romanian authorities to prove eligibility for the treaty regime (specific forms may sometimes be required).

Checklist:

• Certificate attesting to foreign tax residency
• Official form(s) required locally
• Supporting documents regarding amounts already taxed abroad

In Case of Non-Compliance with Obligations Related to International Treaties or Local Procedures:

Possible consequences:

• Effective double taxation on the same income
• Refusal or retroactive withdrawal of initially granted treaty benefits
• Automatic application of standard Romanian internal rates without considering the relevant international treaty
• Increased risk of tax audits, administrative sanctions, or fines

To Remember:

The treaties signed by Romania guarantee a stable framework allowing foreign individuals and companies to legally avoid double taxation, provided all local administrative procedures are followed. The absence or deficiency of documentation almost systematically leads to a definitive loss of the treaty benefit.